On Friday 1 December 2017, the deadline for registration of ultimate, beneficial owners expired. This article will give you a brief account of the consequences of not completing the registration and when companies are required to make the registration.
What are the consequences of not completing the registration?
Lack of registration is penalised with a fine. As of yet, the level of fines has not been publicly announced by the Danish Businesses Authority.
Is it still possible to complete the registration after 1 December 2017?
The answer is: YES!
Bird & Bird recommends that companies established before 23 May 2017, which haven't completed the registration, should ensure that this is done as soon as possible.
When is a company required to register its ultimate, beneficial owners?
The registration is required in three scenarios:
- The company has ultimate, beneficial owners
- The company cannot identify any ultimate, beneficial owners
- The company does not have any ultimate, beneficial owners
All existing and new companies, subject to the new registration rules, are responsible for identifying their ultimate, beneficial owners. If the company does not have any beneficial owners or cannot identify their beneficial owners, the company must report that. Consequently, a company is required to complete the registration irrespectively.
Furthermore, a company is required to store any information that documents the effort to retrieve information about their beneficial owners for 5 years after each identification attempt as well as 5 years after the termination of the beneficial ownership. Moreover, the company is required to update this information, which necessitates a yearly assessment on whether the information relating to beneficial owners is correct.
A company has an ultimate, beneficial owner, where a physical person, directly or indirectly, owns or controls an adequate part of the shares or voting rights, or who exercises control in some other way.
If a physical person owns or controls more than 25% of the company, it is an indication that this person is viewed as an ultimate, beneficial owner.